Skip to main content

Home/ Global Economy/ Group items tagged turmoil

Rss Feed Group items tagged

Filter: All | Bookmarks | Topics Simple Middle
Gene Ellis

Central banks prepare for turmoil after Greek vote | Reuters - 0 views

www.reuters.com/...e-crisis-idUSBRE85D0CA20120616

central banks turmoil greek vote reuters

shared by Gene Ellis on 16 Jun 12 - No Cached
  • ECB President Mario Draghi, one of many policymakers gearing up for trouble after Sunday's vote in Greece, said his bank was ready to step in and fund any viable euro zone bank that gets in trouble.
  • At best, we are going to have a situation that is extremely serious on Monday," Swedish Finance Minister Anders Borg told journalists. "In all likelihood, whatever the outcome, we are going to have a government which is going to find it hard to live up to the agreements they (the Greeks) have signed up to."
Gene Ellis

Eurozone: Looking for growth | vox - 0 views

www.voxeu.org/...eurozone-looking-growth

looking growth vox

shared by Gene Ellis on 25 Mar 13 - No Cached
  • Empirical evidence suggests deleveraging episodes accompanied by a housing crisis will take on average five and a half years across high-income OECD countries (or seven years when accompanied by a banking crisis (Aspachs-Bracon et al. 2011, IMF 2012).
  • Little resolution of banking-sector difficulties in the Eurozone suggests that deleveraging and credit will probably remain slow and impaired for much longer than previously thought. Recoveries that happen without credit are, on average, a third longer than recovery episodes with credit (Darvas 2013).
  • Damages to trend growth are notoriously difficult to assess,
  • ...10 more annotations...
  • In addition, observed GDP growth tends to be revised until several years after the first estimate
  • Our work is based on a simple Solow growth-accounting methodology.
  • A common feature of all economies is a collapse in productivity, which is typical of a big recession. In addition, Spain and Italy also underwent a very sharp labour contraction.
  • The additional effect of ageing.
  • A downside risk is that investment growth does not recover fully (for example, because banks fail to provide the necessary funding). In this case, we assume investment growth is only half what it was before the onset of economic turmoil.
  • We also estimate productivity through a convergence equation, which would slightly lift productivity in peripheral countries in the future.
  • This exercise suggests that in the absence of policy reforms, trend growth will have been damaged significantly, by at least one percentage point, post-crisis, compared with pre-crisis levels,
  • In the event that investment fails to recover quickly
  •  or unemployment levels take longer to fall than in previous recovery episodes, then trend growth would be significantly lower for longer. Trend growth might well remain negative in Spain and Italy, and may fail to increase for Germany or France.
  • this exercise shows the damage will indeed be long lasting, permanently impairing growth in a context of an ageing population that needs higher growth capacity than ever before.
Gene Ellis

Car Factories Offer Hope for Spanish Industry and Workers - NYTimes.com - 0 views

www.nytimes.com/...nish-industry-and-workers.html

car offer hope spanish industry workers

shared by Gene Ellis on 28 Dec 12 - No Cached
  • Four years of economic turmoil and the euro zone’s highest jobless rate have made the Spanish labor market so inviting — an estimated 40 percent less expensive than those of Europe’s other biggest car-making countries, Germany and France — that Ford and Renault recently announced plans to expand their production in Spain.
  • Some experts say such gains in competitiveness and investment are exactly what Spain needs for its economy to recover and to remove any doubts about whether the country can remain in the euro union.
  • Because Spain no longer has its own currency to devalue as a way to lower the price of its exports, it is having to find its competitive advantage in lower labor costs. Many economists have argued that societies cannot survive such painful downward adjustments.
  • ...9 more annotations...
  • That is the lowest level since 1972.
  • Its trade deficit has been shrinking — down 28 percent for the first 10 months of this year,
  • “From 2008, we suddenly realized that we had lost a lot of competitiveness and needed to work very hard to improve things, particularly in terms of labor issues and logistics,
  • Over all, Spain’s unit labor costs — a measure of productivity — are down 4 percent since 2008, according to Eurostat, the European statistics agency.
  • In a related measurement, the most recent Eurostat data put Spain’s average hourly labor cost at 20.60 euros which was well below Germany’s 30.10 euros and France’s 34.20 euros.
  • Unlike most other Spanish industries, car manufacturing has no sectorwide collective bargaining agreement with unions. As a result, each carmaker has been able to adjust working hours with its own employees, in response to changing demand.
  • In return, the companies have promised workers that they will not be subjected to the huge layoffs made in other parts of the economy,
  • I don’t want to give lessons to anybody. But at such a delicate moment for Spain, showing that we believe in flexibility and consensus has certainly been highly valued by the carmakers.”
  • The car sector employs 280,000 people in Spain, including parts suppliers, and accounts for a tenth of the country’s economic output. About 85 percent of the industry’s workers are on long-term contracts.
Gene Ellis

Italy Falls Back Into Recession, Raising Concern for Eurozone Economy - NYTimes.com - 0 views

www.nytimes.com/...cern-for-eurozone-economy.html

shared by Gene Ellis on 05 Feb 15 - No Cached
  • Italy Falls Back Into Recession, Raising Concern for Eurozone Economy
  • Some economists argue that the region is already well into a so-called lost decade.
  • Analysts surmised that the strained relations with Russia as well as turmoil in the Middle East had undercut demand for Italian exports, in particular fashion and other luxury goods.
  • ...8 more annotations...
  • “I definitely expect that things will get worse,” he said.
  • The European Union exported agricultural goods worth 11.8 billion euros, or $15.8 billion, to Russia last year, and sales have been rising at a rate of almost 15 percent a year.
  • The economic data and news that Russia was massing troops and military equipment on the Ukrainian border caused stock prices to fall across Europe on Wednesday.
  • Separately, the German Federal Statistical Office reported on Wednesday that new industrial orders in Germany fell 3.2 percent in June compared with May. Analysts had expected orders to increase.
  • For Italy, the deteriorating economy puts greater pressure on Prime Minister Matteo Renzi, who less than a week ago promised not to impose any more government budget cuts and to invest in improving the country’s roads and other infrastructure. Such promises will be difficult to keep if slower growth, which usually translates into higher unemployment and lower corporate profits, limits tax receipts.A slower economy also endangers Italy’s ability to comply with eurozone rules on budget deficits.
  • Italy’s 2.1 trillion euro government debt equals 136 percent of its annual gross domestic product, the second-highest debt ratio in the eurozone, after Greece.
  • They said Italy’s problems stemmed more from its failure make changes needed to improve the performance of its economy.
  • The slow pace of structural reforms is worrisome,” said Paolo Manasse, a professor of macroeconomics at Bologna University. He said there was no sign of progress on necessary steps like selling off state-owned assets or overhauling the labor market or public pension system.
1 - 4 of 4
Showing 20▼ items per page